Review of 2016: Who are the top 10 most frustrated mobile phone manufacturers?

2016 is about to end. This year, the growth rate of the global smartphone industry has slowed down, but the competition has been extremely fierce. The market structure has also undergone significant changes. Among them, some manufacturers are proud, but there are also some frustrated ones.

Samsung: Accidental "phone crash" ruined a good hand, long-term losses are difficult to estimate

Samsung is the most frustrated mobile phone manufacturer this year. The reason is that the widely popular Note7 was forced to recall and stop selling due to battery defects. It is said that Samsung suffered a loss of up to 6 billion US dollars due to the "explosion", which has been confirmed by Samsung's latest third-quarter financial report, that is, Samsung Electronics, which owns its smartphone business, saw its overall operating profit drop by 30% to 5.2 trillion won in the third quarter, of which the operating profit of the mobile department dropped by 96% compared with last year, setting a record low since the launch of the Galaxy series. And this will be reflected in revenue and profit in the next quarter.

If the decline in revenue and profit is only the short-term negative effect of the "explosion" on Samsung, then the long-term and inestimable loss is that the Samsung brand image in the public's mind has been greatly reduced. According to the latest survey data from Market Strategies, overall, 33% of Samsung users expressed their willingness to buy the iPhone 7. What is more interesting is that nearly half (45%) of Galaxy Note users want to buy the latest iPhone model, which is significantly higher than other Samsung device users. It seems that the "explosion" of the Galaxy Note 7 has indeed had a considerable negative impact on the Samsung brand.

Apple: Lack of innovation has led to a missed opportunity for a rebound from rivals

In the past two years, Apple Inc. has never encountered such a good market environment. First, its iPhone 6 sold well, and then its arch-rival Samsung's Galaxy Note 7 was discontinued due to "explosion". However, this year Apple has largely failed to take advantage of the good opportunity given to it by Samsung Electronics. In terms of sales, its iPhone business is also declining. According to the latest data from market research firm Gartner, Apple's global smartphone market share has almost halved since 2014.

For example, in the third quarter of this year, Apple sold 43 million iPhones, a year-on-year decline for three consecutive quarters, and its iOS market share was just above 10%. According to another report released by market statistics agency CIRP, compared with last year's iPhone 6s/6s Plus, this year's iPhone 7 series phones have become less attractive to Android users, that is, since the iPhone 7 was launched, only 17% of buyers used Android phones. A year ago, 26% of iPhone 6s/6s Plus buyers were Android users. In other words, the sales of the iPhone 7 series phones are still driven by old Apple users. This also reflects from one aspect that Apple's iPhone innovation is indeed lackluster, and what is even more disappointing is that this lack of innovation has been magnified by missing the opportunity of Samsung Note7 "explosion".

BlackBerry: After repeated attempts to save itself, it shut down its mobile phone business

Once upon a time, BlackBerry was synonymous with high-end smartphones, especially after the 9/11 terrorist attacks, when it became popular in North America and even the world. The physical full keyboard design also became BlackBerry's iconic feature, but this year BlackBerry announced that it would cease its smartphone business (outsourced to other manufacturers).

Although BlackBerry launched a new version of its mobile operating system several years ago and has repeatedly saved itself, it still cannot stop the decline in market share. In important markets such as North America and Europe, BlackBerry's share has already fallen to single digits. The reason is that for many years, BlackBerry has positioned its mobile phone products as business phones, but for consumers, business phones have not deviated from the ranks of consumer electronics products. BlackBerry was unable to make its mobile phone products popular after the emergence of the iPhone, which is a major reason for the compression of BlackBerry's market share.

In addition, since Chen Shouzong took over as CEO of BlackBerry, he has opened his core applications such as BBM to competitors' platforms, until he abandoned his own mobile phone operating system and joined the Android camp. This has greatly weakened BlackBerry's differentiated competitive strength in the smartphone market to some extent.

Microsoft: Stopping sales and writing down assets means Windows Phone is dead in name only

In 2016, the main theme of Microsoft's mobile phone business was layoffs, suspension of sales and asset write-downs. For example, Nokia, which Microsoft acquired, wrote down its assets by another $950 million this year, based on last year's write-down. It can be said that the value of Nokia's mobile phone business, which Microsoft acquired for about $7.2 billion, has been completely lost. It is worth mentioning that the only smartphone brand Lumia has announced the suspension of sales, which is generally considered by the industry as a precursor to Microsoft's withdrawal from the smartphone industry.

The industry's predictions are not without market basis. Kantar's latest statistics show that Windows Phone's sales share continued to decline in 2016 compared with 2015, and sales share showed a downward trend in almost every single market. For example, in Germany, Windows Phone's sales share fell from 7.6% to 3.3%, a drop of no less than 4.3%, while in the UK, sales share fell from 9.8% to 3.6% (a drop of 6.2%). According to Kantar data, Windows Phone's sales share fell by 7.1% year-on-year, and in the Italian market, this figure was 7.8%. It is worth mentioning that Microsoft Windows Phone's share of the Chinese smartphone market is zero. Faced with such a situation, although Microsoft claims that it will not withdraw from the mobile phone market, it is an indisputable fact that it exists in name only.

Xiaomi: Shipments plummet, China's "Apple" loses its glory

I wonder if the industry still remembers that when Xiaomi, known as the "Apple" of China, raised funds in 2014, the company's valuation reached 46 billion US dollars, and it once became the world's most valuable startup. At that time, Xiaomi was also the most popular smartphone manufacturer in China with the largest market share, and planned to expand into the global market. But last year, Xiaomi failed to achieve its global smartphone sales target. IDC data shows that Xiaomi's smartphone sales in the Chinese market fell by 45% in the third quarter of this year. So far, Xiaomi has not only lost the throne of the champion of smartphones in China this year, but also fallen out of the top five in the global smartphone market.

Industry analysts believe that the decline in Xiaomi's shipments this year is mainly due to the impact of Xiaomi's previously popular "cost-effective" mobile phone model on the "quality-price ratio" mobile phone model of Huawei, OPPO and vivo, and the change in the purchasing method of users in the Chinese mobile phone market from online to offline and online, which has led to a sharp decline in the competitiveness of Xiaomi's Internet marketing method that has been tried and tested, and the shortcomings of offline channels have become increasingly prominent. From the product level, except for the Xiaomi MIX released before the end of this year, which attracted attention due to its design, the others have failed to cause a response in the market and among users. Xiaomi's mobile phones are still supported by the Redmi series of mobile phones in the thousand-yuan range. What is more worrying for the industry is that even so, Xiaomi has announced that its mobile phone business is not profitable.

Lenovo: Frequent "changes in leadership" cannot reverse the decline in mobile phone sales

Similar to Xiaomi, Lenovo was once the third in the global smartphone market and the second in the Chinese mobile phone market. However, due to weak product competition, especially after the acquisition of Motorola Mobility, Lenovo has been in the process of "changing leadership", which has continued until this year. The most typical manifestation is that the head of the mobile phone business has changed again this year. And with the "change of leadership", Lenovo's mobile phone strategy has always been in a state of vacillation. For example, in the future, Lenovo's mobile phones will all adopt the acquired Motorola brand, and Lenovo's previous self-owned brands Vibe and ZUK will disappear (why did they know this would happen in the first place). Despite such adjustments, Lenovo's mobile phones have not been able to stop the downward trend in both shipments and revenue. The latest statistics show that Lenovo's mobile phone shipments in the Chinese market have fallen below 10 million. Although overseas markets, especially the Indian market, have grown rapidly, it is still difficult to make up for the losses in the Chinese market, and the future prospects are worrying.

LeEco: Broken capital chain triggers industry doubts about its entire ecosystem model

The main reason why we list LeEco as one of the unsuccessful mobile phone manufacturers in 2016 is not that it is still selling mobile phones at cost price and the huge losses in this business, but the domino effect caused by the broken capital chain exposed at the end of the year, which led to the industry's doubts about its full ecological model. In other words, the broken capital chain of LeEco mobile phones is the fuse of LeEco's recent doubts and crises in the industry. Given that LeEco mobile phones are an important part of LeEco's ecology, both in terms of revenue and losses, although LeEco and the industry believe that automobiles are the business that will affect LeEco's future, we believe that whether LeEco's model will succeed or fail in the future, the performance of the mobile phone business is actually the key. As the saying goes, success or failure depends on mobile phones. Just wait and see!

Hammer: The "sentiment" is gone, even the best products will become homogenized

Perhaps the industry thinks that we are doing a disservice to Smartisan by listing it as a frustrated mobile phone manufacturer. After all, the third-generation mobile phones Smartisan M1 and M1L released by Smartisan this year have been well received in the industry and the market. However, what we want to say is that in today's smart phone industry, where there are so many domestic and foreign competitors, how good can a Smartisan mobile phone without any unique mobile phone-related industrial chain and marketing advantages be? Or what is its differentiated advantage that can really make users buy it? Lenovo's previous biggest selling point of Smartisan mobile phones was the "feelings" of its founder Luo Yonghao, but from the Smartisan M1 and M1L products, this "feelings" obviously no longer exist. When a company's products have no innovation and differentiation from the beginning, and are only maintained by "feelings", and are eventually shattered by reality, and then have no choice but to return to reality, perhaps the existence of the Smartisan mobile phone is a business paradox.

Meizu: It seems profitable, but the debt must be repaid

Similar to Hammer, the industry will have objections to our listing of Meizu as the most frustrated manufacturer, because this year Meizu not only released new products like "concerts" continuously (it is said to have released 14 new mobile phones), but also recently announced that its mobile phone business is profitable this year. However, from the previous market research agency Strategy Analytics's survey on the profitability of the global smartphone industry, the profitability of Chinese mobile phone companies Huawei, OPPO and vivo (combined with shipments) shows that even if Meizu is profitable, it is probably very few. But one thing Meizu did not mention is that this year's patent lawsuit by Qualcomm in the Chinese and overseas markets has not yet been resolved. Judging from the fact that Chinese mobile phone companies have signed patent licensing agreements with Qualcomm this year, Meizu's debt (whether it is a judgment or a settlement) will have to be paid sooner or later. As for how Meizu's profitability will be after paying this debt? Perhaps the seemingly profitable benefits this year may be lurking with greater frustration.

Coolpad: Existing in name only, it has become the "Xianglin Sao" of the mobile phone industry

Since establishing a joint venture with 360 and letting LeTV take a stake, Coolpad has not had good luck. Coolpad Group previously announced that it expects a net loss of HK$3 billion (about RMB 2.66619 billion) this year, which is in sharp contrast to Coolpad's net profit of HK$2.325 billion in 2015. In response, Credit Suisse published a research report, lowering Coolpad Group's target price from HK$1.2 to HK$0.9, maintaining its "underperform" rating. In fact, it is not terrible for a company to suffer losses due to temporary difficulties, but it is terrible to lose the courage to rise again independently. This can be seen from its disguised sale to 360 and LeTV. After all, it is also a member of the "China Cool Alliance" in China's mobile phone industry. Look at Lenovo and ZTE. Although their performance has declined or is not ideal, they are still supporting it. We list Coolpad as one of the most frustrated manufacturers this year, mainly because it has lost its corporate independence and tone. We don't know which company's pedigree Coolpad mobile phones will be mixed with in the future, but it is an indisputable fact that it has become the Xianglin Sao of the mobile phone industry.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.